Immuron Limited ABN 80 063 114 045 Annual report for the year ended 30 June 2018 Immuron Limited ABN 80 063 114 045 Annual Report- 30 June 2018 Contents Page Corporate directory 1 Intellectual property report 6 Directors

the year ended 30 June 2018

Limited ABN 80 063 114 045

Report- 30 June 2018

clinical trial produces promising results

IMM-124E phase II Non-Alcoholic Steatohepatitis (NASH) clinical study has clearly demonstrated significant reductions in serum

Lipopolysaccharide (LPS), as well as reductions in other biomarkers associated with liver damage.

drug candidate IMM-124E, a first-in-class, oral antibody therapeutic targets the endotoxin LPS and other gram negative bacterial

components in the gut and prevents translocation into the blood circulation where they drive inflammation and cause damage to

the liver. The 24-week treatment study in Australia, Israel, and the US targeted 133 biopsy-proven NASH patients. The results

revealed nearly 64.3 per cent of IMM-24E-dosed patients showed a 15 per cent or greater decrease in serum LPS levels, compared

with just 34.5 per cent of patients showing a decrease in the placebo group.

the same time, the study showed decreases in both Aspartate Transaminase (AST and ALT) and Cytokeratin-18 (CK-18), metabolic markers

associated with NASH and liver damage.

reported results provide conformation of a unique mechanism of action and proof of concept that metabolic endotoxemia can be decreased

by using this drug candidate to prevent LPS translocating into the blood stream. Another expected but nonetheless pleasing outcome

was the confirmation that IMM-124E was retained within the gut lumen and was not absorbed systemically. This finding strengthened

IMM-124E's safety profile and potential for use in combination with other therapeutics.

is a severe form of non-alcoholic fatty liver disease (NAFLD). It represents an impending health crisis with between three and

five per cent of the US population affected, particularly through its obesity epidemic. Between two and four per cent of the global

population is also thought to be at risk. Projected annual costs of NASH treatment could reach USD25 billion by 2026.

expands commercial returns, extends therapeutic potential with US Defence study

the back of elevated sales for Travelan in the first half of 2017/18, the sales trajectory continued upward in the third quarter

in both the United States and Australia.

is Immuron's oral over-the-counter gastrointestinal and traveller's diarrhoea treatment.

Company's global gross sales reached AUD$2 million which resulted in 29% increase against the gross sales in 2017. In USA

alone, gross sales saw an increase of 114% over 2017. While in Australia, the gross sales managed an increase of 19% over 2017.

this trend continues, Travelan will continue to see an increase against the 2018 sales performance. With a sharp focus on a consistent

trade and pharmacy marketing program in both countries, and the expected addition of new territories to promote Travelan, sales

growth is projected to continue growing.

Department of Defense backs Travelan research

other Travelan news, a US Department of Defense-commissioned study has shown Travelan has effective immunological reactivity to

dangerous and potentially fatal infectious bacteria.

Department of Enteric Diseases (DED), Armed Forces Research Institute of Medical Sciences (AFRIMS) performed the study. It took

place at a laboratory of the Walter Reed Army Institute of Research (WRAIR) in Bangkok. WRAIR is one of the leading health research

organisations in the world.

study, one of three involving Travelan, looked at 60 clinical isolates of each of Campylobacter, Enterotoxigenic Escherichia coli

(ETEC), and Shigella from infected US Defence personnel in southeast Asia between 1993 and 2016. The study found that Travelan

antibodies were reactive to all 180 clinical isolates tested.

believe that our continuing collaborations with the DoD are a powerful validation of the potential of our platform to develop

novel anti-infectives.

patients enrolled in Clostridium difficile clinical study

29,000 annual deaths, and 450,000 people affected by Clostridium difficile infection (CDI) in the United States alone, the positive

progress of our IMM-529 CDI clinical trial is welcome news.

mostly strikes older people following the use of antibiotics, or extended periods of hospitalisation. It manifests in a range

of symptoms, from diarrhoea to potentially life-threating gut inflammation. Our clinical study will treat 60 patients diagnosed

with CDI, beginning with recruits at the Hadassah Medical Centre in Israel.

infected, patients face high rates of recurrence. The cost to the US healthcare system alone is estimated at $4.5 billion a year.

pre-clinical program successfully completed

May 2018, we announced the completion of our IMM-124 colitis preclinical mice program at the University of Zurich.

results follow in parallel with our NASH clinical study, which showed significant reductions in serum Lipopolysaccharide (LPS)

levels. LPS endotoxins are chief suspects in the inflammation associated with colitis and inflammatory bowel and other autoimmune

administration of IMM-124E was shown to successfully treat mice with colonoscopy confirmed immunologically induced colitis. The

results revealed that treatment with IMM-124E significantly reduced intestinal inflammation associated with colitis and produced

substantial reductions in weight loss, disease activity scores, shortening of the colon, and macroscopically detectable colitis.

believes IMM-124E may represent a novel therapeutic to induce and maintain remission in IBD patients. The findings of the University

of Zurich studies have been submitted for presentation at the annual United European Gastroenterology Week conference to be held

in Austria in October.

Liver Porfolio - Two Ongoing Phase 2 Programs in clinical development (ASH and Pediatric NAFLD)

Arun Sanyal is the lead Principle Investigator for the Immuron alcoholic steatohepatitis (ASH) clinical study which is funded

by the NIH. The study has enrolled 56 patients with severe alcoholic hepatitis and recruitment into the study has now been closed.

The primary endpoint is changes in ALT (liver enzymes) and topline results are expected in Q1 2019.

Liver Porfolio - Two Ongoing Phase 2 Programs in clinical development (ASH and Pediatric NAFLD) (continued)

17.3 percent of Americans aged 15 - 19 suffering NAFLD, Health authorities estimate paediatric NAFLD affects five to 10 percent

of the US paediatric population, with no current approved treatments. The lead Principle Investigator for our Paediatric NAFLD

study is Dr Miriam Vos, Emory University. Dr Vos specializes in the treatment of gastrointestinal disease in children as well

as fatty liver disease and obesity. Our NIH funded Phase II double blind, placebo control, randomized study on IMM-124E has enrolled

19 patients approximately 50% of the targeted 40 patients into the study. The primary endpoint is changes in ALT (liver enzymes)

following 3 months of treatment with top-line results expected in Q2 2019.

marketing and fundraising efforts step up

profile marketing via road-show appearances, analysts and investment conferences, and business television broadcasts continued

throughout the period.

January, Chief Executive Officer, Dr Jerry Kanellos was interviewed on the US Redchip Money Report, The Action Channel, and on

American Business TV's The Family Channel. The latter has access to 100 million homes in the US.

in January, he presented at the 10th Annual Biotech Showcase in San Francisco where he was able to meet with influential representatives

from investment and pharmaceutical circles.

March, we released a company presentation outlining all the latest developments across all of Immuron's platforms, as well

in April, Dr Kanellos presented at the monthly US Redchip Global Online Growth conference. The conference attracts large numbers

of analysts and investors - more than 12,000 participants attended the Redchip Global Online CEO conferences last year.

the Australian Government's Research and Development Income Tax Concession incentive scheme, Immuron received a AUD2.16

million cash refund. The payment rewarded our investment of more than AUD4.6 million in continuing R&D. The funds will go

towards accelerating timelines for pipeline programs.

mid March, we responded to market demand by completing a AUD5.1million private placement with a large US institutional investment

fund. The placement saw the issue of 13,162,744 new ASX shares. The funds will underpin current and future clinical programs,

support continued Travelan marketing, and secure working capital.

has appointed international firm Grant Thornton Audit Pty Ltd as auditors for both our Australian and US operations. Grant Thornton

Audit Pty Ltd replaced Marcum LLP in the US and William Buck Audit Pty Ltd in Australia.

Chief Executive Officer (CEO) Immuron Limited

Intellectual property report

has a policy to identify, capture and protect all relevant intellectual property associated within its core business strategies.

The company owns a number of patent families that have been filed to protect both the vaccine that is used to generate Immuron's

colostrum enriched with antibodies of choice, as well as methods of treating certain conditions with the resulting hyper-immune

colostrum. The company further maintains a significant register of trademarks, particularly in association with the product Travelan.

patent rights are supplemented by a comprehensive body of confidential and proprietary expertise that has been developed over

many years and relates to the methods of production of the hyper-immune colostrum. These trade secrets include information relating

to a low cost production system and an effective immunisation process that is approved by an independent animal ethics committee.

the year ended 30 June 2018, Immuron continued to progress its patent portfolio and has successfully prosecuted patents to Grant,

over various global jurisdictions.